My mother-in-law passed away in 2012. She owned a bungalow outright with no mortgage.
She lived with a partner; they were not married. In her Will she left the property jointly to her two children, being my wife and bother in law, with a request that her partner should remain in the property until his death, providing he maintained the property and paid the bills.
At the time, the property was registered at the LR in the names of my brother-in-law and my wife, as Tenants in Common, 50/50.
There was also a wish that when the property was sold on the death of her partner, £10,000 should go to each of her three grandchildren.
My brother-in-law passed away in 2017, dying intestate. He was married and had one daughter, one of the three grandchildren mentioned above.
My brother in law’s Will was settled in 2018 under the rules of intestacy. The accounts show my sister-in-law inheriting my brother in law’s 50% share of the property worth X amount. Based on this valuation X, his daughter inherited 50% of everything over £250,000, which was paid in cash at the time.
Subsequently, my mother in laws partner passed away in September 2021. On the sale of the bungalow, my sister-in-law has been advised that due to the increase in value of the property, despite being 50/50 TIC with my wife, she needs to pay 50% of any amount received above the value X, to her daughter.
This does not seem right to me, as the Will was settled in 2018 based on the values at the time, leaving my sister-in-law with 50% of the property. Her daughter is not mentioned on the LR docs at all.
Why would her daughter have any interest in the bungalow after the will was settled in this way in 2018?
Any advice appreciated, TIA.
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Who advised her?
Id say that maybe Bs estate couldn’t, or shouldn’t, have been fully settled at the time of his death because it would have been dependent on the value of the property he owned after the death of D.
according to the rules of intestacy, his wife should have received £270K, and half of the remainder with the balance going to his daughter.
However, as the house could not be sold until D died some years later, it’s value could have increased significantly. Eg now worth £1m. His share is now worth £500k. Widow still gets £270k, plus half of £225k = £382.5k. Daughters share should be £112.5k.
If that is the case then the estate was wound up correctly and the daughter has no further claim, as before the house was sold it was owned 50/50 between your wife and SIL and the proceeds shared between to two less CGT.
The Will was written by my MIL. The provision for her partner to stay in the property was a wish, as everything was left to my wife and late BIL. The valuation was accurate for the time, assuming there was no occupant, which clearly was not the case, as my wife and BIL complied with their mother’s wishes, to allow her partner to reside there.
The increase in value is a reflection of the housing market over recent years.
if your SIL wants her daughter to get more of her share she can gift it to her.